Facts of the Case

The petitioner, Filatex India Ltd., challenged the notice dated 08.06.2021 issued under the erstwhile Section 148 of the Income Tax Act, 1961, subsequently deemed to be a notice under Section 148A(b), along with the order dated 30.07.2022 passed under Section 148A(d) and the consequent notice issued under Section 148 for Assessment Year 2014–15. The petitioner contended that the reassessment proceedings were barred by limitation. A detailed limitation chart was placed before the Court based on the Supreme Court judgment in Union of India & Ors. vs. Rajeev Bansal, demonstrating that after accounting for the extended limitation under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 and the period to be excluded, the notice under Section 148 dated 30.07.2022 was issued beyond the permissible time.

Issues Involved

Whether the reassessment notice issued under Section 148 for AY 2014–15 was barred by limitation after applying the principles laid down by the Supreme Court in Rajeev Bansal, and whether the matter should be remanded to the Assessing Officer to determine the surviving period of limitation by passing a reasoned order.

Petitioner’s Arguments

The petitioner argued that the reassessment notice issued on 30.07.2022 was clearly beyond the permissible limitation period even after giving the benefit of extensions under TOLA and exclusions recognised by the Supreme Court. Reliance was placed on the limitation computation affirmed in Rajeev Bansal and on earlier Delhi High Court decisions holding that reassessment notices issued beyond the surviving period are unsustainable in law.

Respondent’s Arguments

The Revenue did not seriously dispute the computation of limitation advanced by the petitioner. It was submitted that, in line with earlier Delhi High Court judgments, the matter could be remanded to the Assessing Officer for determination of the surviving period of limitation by passing a detailed and reasoned order after granting opportunity of hearing to the petitioner.

Court Order / Findings

The Delhi High Court noted that a similar approach had been adopted in earlier decisions, including Mahendra Kumar Jhanwar vs. Income Tax Officer, where reassessment notices were remanded for determination of the surviving limitation period in light of Rajeev Bansal and other binding precedents. The Court held that, for parity of reasons, the impugned notice under Section 148 deserved to be set aside and the matter remanded to the Assessing Officer to examine afresh whether any surviving period of limitation existed, after considering the limitation chart and relevant judgments.

Important Clarification

The Court clarified that the Assessing Officer must grant an opportunity of hearing to the petitioner or its authorised representative and pass a detailed and speaking order dealing specifically with the issue of limitation. The exercise was directed to be completed within a stipulated time frame.

Final Outcome

The writ petition was disposed of. The impugned notice issued under Section 148 of the Income Tax Act for AY 2014–15 was set aside, and the matter was remanded to the Assessing Officer to decide the issue of surviving limitation period afresh in accordance with law, after granting opportunity of hearing to the petitioner, and by passing a reasoned and speaking order within eight weeks.

Link to Download Order- https://www.mytaxexpert.co.in/uploads/1769502396_FILATEXINDIALTDVsASSISTANTCOMMISSIONEROFINCOMETAXORS..pdf  

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